U.S. manufacturing contracted for the first time in nearly three years, while in the euro zone the jobless rate rose to a record high in May and a measure of factory activity held steady at its lowest level since June 2009. Asia was hit by crumbling orders from abroad.
The pressure to do something will grow on the Fed. For now, the market is digesting the hit, but hopes of a sustained rally may be too early with some of the negative news regarding the global business cycle yet to be priced in, said Sebastian Galy, strategist at Societe General.
MSCI's broadest index of Asia-Pacific shares outside Japan <.MIAPJ0000PUS> edged up 0.2 percent. The index surged 2.7 percent on Friday for its biggest one-day rise in more than six months, following news of a European agreement to shore up the region's banks.
Japan's Nikkei average <.N225> opened up 0.1 percent. <.T>
Worries about weakening demand from sluggish economic growth hurt oil, with U.S. crude futures falling 0.4 percent to $83.39 a barrel after a drop of more than $1 the previous day. Brent eased 0.2 percent to $97.13 a barrel.
The euro held steady around $1.2580, a tad above Monday's low of $1.2568 but well below Friday's high of $1.2693.
Traders expected the European Central Bank to move to bolster the region's economy by cutting its main refinancing rate by 25 basis points to 0.75 percent on Thursday at its policy meeting.
We believe further follow-through after the ECB decision will be difficult if, as we suspect, the market focus returns to the associated implementation risks, said Barclays Capital analysts in a research note.
The euro fell on Monday after Finland and the Netherlands opposed a plan for the euro zone's permanent bailout fund to buy government bonds in the secondary market.
The markets' euphoria quickly faded over a surprise agreement last week by European leaders to let their rescue fund inject aid directly into stricken banks and intervene in bond markets to support highly indebted states, as markets turned to potential risks such as the insufficient size of the rescue fund and the ratification process in each member state.
Asian credit markets were subdued, with the spread on the iTraxx Asia ex-Japan investment-grade index barely changed from Monday.